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charged with conspiracy to go kill americans after the september 11th attacks. i'm tony harris. if you would like the latest on all of our stories head over to our website at "real money with ali velshi" is next on al jazeera america. >> in big financial trouble. and we'll talk you inside venezuela where toilet paper is hard to find but gas is practically free. we have a look at a handout that both parties in washington could get behind. i'm ali velshi, and this is "real money."
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>> the peninsula on the black sea ukrain ukrainian basis cont. the but interim government in kiev insists that those troops are part of a russian force that is invaded crimea. moscow denies that, insisting the troops are local self defense you wants opposed to last week's jousting of ukraine's popularly elected president. diplomats from europe, the united states and russia have met separately in paris today to try to defuse the worst crisis on the continent since the cold war. the key sticking point is russia's refusal to recognize the new interim government in ukraine which seized power after months of sometimes violent protests in kiev and other cities. in the meantime the west has firmly thrown its support behind the new ukrainian government.
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the european union announced an aid package of $15 billion to ukraine. that is designed to make up for a russian package of about the same amount that had been forthcoming until the events of last week. now that announcement comes a day after secretary of state john kerry promised $1 billion in loan guarantees from the united states to try to offset the loss discounts on natural gas that ukraine has been getting from russia until this all happened. now all of this underlines the deep economic mess that ukraine is in. the new interim government said it needs $35 billion in cash to avoid financial collapse. today ukraine's interim finance minister rocked his country's country's currency and bond markets by saying that kiev might start creditors on restructuring its debt. joining me now is the new government's economy and trade minister.
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thank you for being with us. you've heard hydration on ukraine. it seems fairly serious, how would you characterize it. >> it relates to public finance. the public finance is in pretty bad condition. however, the health of the economy is not that bad. comparing, for example, with the situation, with the crisis of 2008 when the next year in 2009 ukrainian economy collapsed by 15%. last year 2013 was not so good, but it was not so bad. so what is recorded is zero percent of growth, it doesn't make us happy at all, but it's nothing like the crisis in 2008. at the same time let me repeat the public finance is in disarray and something we need to take care of. >> you're the economy minister. you're a trained economist as
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such this could not be good economics to be dealing with a fiscal crisis, a public finance crisis and possibly a war. what is happening in your government right now to avoid this escalating any further militarily. >> ukraine will be using only peaceful means. we are being provoked, but we are not responding to the provocations. our military stands still. most of our military people defend the basis that they serve on using peaceful means. and that's the message we would like to send to our neighborhoods. we would like to use only negotiations, communications, talks and discussions to figure out what the problems are, and how can we resolve those problems. that's talking about crimea. now talking about the nation together we are dealing with the
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austerity measures developing the austerity measures and the government is the first body to start. we actually caught all the unnecessary wastes and expenses because of the number personnel we're using. the austerity measures will start with the government. >> i suspect you were not getting a lot of congratulations on your new role as economy minister, but as you and the interim government go out there and seek legitimacy and deal with these western governments how do you respond to the question that many people who do not understand the history of ukraine and are just learning about it in the last few weeks, how do you deal with the question that ukraine deposed a popularly elected government? >> well, first of all, he fled the country. there was an agreement signed with him that there will be a
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coalition government, there would be return to the parliamentary type of constitution which he changed into the presidential type of republic. and the new presidential election won't happen until the end of the year. the opposition, i mean the former opposition, now the government, kept all its promises. so all of these conditions are done. well, the president decided to leave the country. i understand him because after the bloodshed that happened after his rule, and we suspect at his orders, in order to create a little space for him in the capitol city of ukraine, so now we're heading into presidential elections. so in june it looks like maybe after the second round of elections we'll have a new popularly elected president. >> and then as an economist what
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is the best outcome for ukraine, and for that matter, for eastern europe? what's the best thing to happen? this was triggered by a trade deal that ukraine was engaging in with europe that the president turned against. what is the thing that should happen that will stabilize ukraine and that part of europe? >> many things are already done. you mentioned the loans and support that we got from different countries all around the world, from international institutions. you probably know there is a mission of international monetary fund working now in kiev. i had a meeting with them this morning. what can happen best? well, first of all at the first stage we will stabilize the finance. the defend of all we will start the economy moving, jump start the economy, and ideally in a couple of years this beautiful, large productive nation with
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incredible resources in terms of fertile black soil will blossom. this is our dream. >> the economy minister of interim government of ukraine. thank you for joining us. thank you for your time, sir. venezuela is a country rich with oil but poor when it comes to basic necessities. tonight a first-hand look. >> this is one of the few places in the world where this bottle of water costs more than a gallon of gasoline. this packet of gum costs more than filling up this entire suv. and forget about raising the minimum wage for now. i'll tell but another way to help those who need it that may stand a chance of passing in congress. that and more as real money continues. keep it right here.
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>> the van versuthe anniversaryh of hugo chavez, it's a vast divide left in the wake of chavez's death. now nicolás maduro presided over a military parade drawing a who is oh who of leftest leaders all paying respect to the combative predecessor. meanwhile protests are taking place. demonstrators demanding tha de t maduro quit. this protest has been going on for weeks and 18 people have died. venezuela is rich in energy but poor in necessities like milk. david will help explain the sometimes complex relationship between our two countries.
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>> david? >> this is venezuela's largest port city. we have refineries behind us and it's areas like these that are critical to venezuela's future. the influence in the region is wielded through petroleum. we talk about protests. we talk about high stakes in region where there is much natural gas and much crude oil. this is in many ways is why what happens in venezuela is so important. oil. venezuela is the fourth largest supplier of crude oil to the united states behind canada, saudi arabia and mexico, and has the largest reverse in th resere world. but because it does not have an refineries an unlikely partnership has emerged from the united states and this south american nation. >> years ago even under hue go
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chavez, when he's talking about our being the devil or some of these rhetorical positions, the bottom line is that the united states is the closest largest market for venezuelan oil. >> and the u.s. is thirsty for oil. despite a recent energy boon it still imports 40% of its oil needs. of those imports 8% comes from venezuela which accounts for nearly 1 million barrels a day. refiners process venezuelan crude in places like texas and illinois, adding american jobs before sending the refined product or gas lean back to venezuela. >> there is a lot at stake here for the venezuelan government to show responsible stewardship inside of its own country and the united states has to temper its response considering the fact that venezuelan oil is a major supply source for the united states. >> but some venezuelan officials
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say their country could pump more of the oil business back into their own economy by investing more in domestic refineries using foreign expertise and building out their infrastructure. >> the government has neglected infrastructure and left our national oil company in a difficult situation because they seem to have abandoned the investment we need to keep growing. >> reporter: protesters here often point to the stagnating economy, rampant inflation and lack of infrastructure as chief reasons for take together streets. together--taking to the streets. for years the government tried to placate their concerns by heavily subsidizing good. >> in bottle of water costs more than a bottle of gasoline. the government keeps it that way to prop up the economy especially in poor neighborhoods, but in context this pack of gum costs more than
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filling up this entire suv. critics say that has led to a thriving black market and supply shortages, but it has instead eased the financial burdens of the poor. many of who took to the streets for ca carnival. but as protesters continue to square off with authorities across the nation, all eyes are focused on whether a disruption of government could disrupt venezuela's all important economy. when we talk about the vast amount of crud oil that venezuela supplies to the world, we have to look at it in terms of import. it's the eighth largest importer throughout the world. that speaks to some of the infrastructure problems and questions that a lot of people here are protesting about. >> david, clearly your story, you know, outlined the close relationship that americans don't know they have with
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venezuela and maybe that venezuelans don't know they have with america. do venezuelans have the same animosity towards the united states that hue go chavez had and that nicolás maduro seems to have. >> a lot of venezuelans have connections to the united states. they have family in florida and new jersey. in caracas, you talk to supporters and those who are very much in line with the party line and they subscribe that to that notion that maduro brings up. but then you head out to opposition areas where the opposition really began last month, and the focus is more oriented towards its colombian neighbors and far less from what you would get in the eastern portions of the country. as this unfolds the question that a lot of people have now not only here but throughout the region is what happens to this
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oil economy that the country is relyingen. >> david will be back with us shortly. thank you. let's bring in stephen shorts, he joins us from philadelphia. stephen, good to see you again. one must not diminish the relationship between the u.s. and venezuela. you say we do need to be worried. >> oh, absolutely. look, u.s. imports on venezuelan oil have been, that said we're still importing 800-barrel as day of crude oil we're, indeed, relying on venezuelan crude i'lloil.the concern is not unlie
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libyan experts that went missing around this time of year. this is important because we're getting ready to build gas seen stocks for the summer drive season. if the situation in venezuela continues to escalate and that effects the venezuelan crude oil right at the time of the driving season, that could be a significant impact on price going into the new season. >> stephen, a lot of these venezuelans, middle class venezuelans are just upset with how the government operates itself. but what is the history of the government under hugo chavez did. it used to be a very efficient system. they had a lot of oil, they produced a lot of it. that's been dropping over the last several years. >> o absolutely, ali. back 10 or 12 years ago that was a general strike that was meant to unseat chavez. thosafter that strike was settld
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chavez pared the structure with his own cronies who are quite incapable of running a company. therefore whatcha advise did in his tenure in officin--thereford was, he chose not to pour money into his export market but to spread venezuela with his rhetoric. he missed out on the biggest commodity bubble of amen time. when chavez left office, it was $10 a barrel and at the it's height was $20 a barrel, and it never improved after chavez came into office. it was a tremendous waste. >> stephen schork, always a
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pleasure to have you on the show. president obama talked about raising the minimum wage but that's only one way to help hard-working americans who struggle to pay their bills. we'll talk about another plan, one that washington may be able to pass. stay with me. you're watching "real money." ♪
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>> lisa flesher with what is coming up on "the stream" . we talk about the disappearing middle class. that may be most true when referring to military families. >> that is right. food stamp usage has increased at military stores since 2007 and a lot of military families struggle just to make ends meet 2347 i imagine there are a lot of factors at play in this. >> there are, from straight salaries and very high unemployment for military spouses. >> reporter: that's the treatment right after "real money." >> well, the debate over raising the federal raise got another airing today.
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president obama traveled to connecticut to press the case for raising the wage to $10.10. while the president was surrounded by four governors who support the move, republicans who control the house of representatives do not. this is more about politics in an election year than reality. we learned that mcdonald's warned invest necessary a public filing that it's profitability may suffer if it has to raise wages amid, quote, increasing public focus on matters of income inequality. i'm a big fan of mcdonald's but there should be increased focus on income inequality, mcdonald's. it will be expanding the earned tax credit. it is the government's largest program targeted as low income americans. >> the earned income tax credit was first introduced by president ford and has been
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expanded by democrats and republicans alike because it provides an incentive to work. president reagan called it the country's best anti-poverty and jobs creation bill ever to come out of the u.s. congress, and it was a key part of president clinton's welfare to work program. the basic way the earned a tax credit worked is this an eligible worker will earn a tax credit for every dollar he or she makes. a formula determines how much a worker ultimately receives under the program's caps. that amount the worker receives is then applied to taxes. for example, if someone owed $700 in taxes and has a credit of $900 they would get a refund of $200. working families with children currently stand to benefit the most. they qualify for a credit if they earn under 38,000 to
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$51,000. generally a salary increase the credit lowers. a married couple with two children making $45,000 would be eligible for a credit of $706. low-wage workers without children currently benefit the least. a person with no children earning $12,000 would only be eligible for a credit of $177. president obama wants to change that. he's proposing to include more low income workers without children. he also wants to extend the age limits to include younger and older workers. cashiers, retail sales people along with waiters and waitresses are among the workers standing to be helped the most under the president's plan. mary snow, al jazeera. >> well, there's no reason why an increase in the minimum wage can't be coupled with an increase or expansion of the earned income tax credit. that's what norm ornstine joins
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us from washington. thank you for joining us. first of all, how important of a deal is this earned income tax credit? if you don't receive that credit you probably don't know that much about it, but the president is trying to sell this as an improvement to people's well-being. >> and it is. this is a huge bonus for people who are working full time, but making at or near the minimum wage. it gives them an opportunity to have more money in their pockets, money to spend on essentials. but it has really been one that's left out single people, people without children. and what the president will do is expand it to a lot of those people and also reduce the age eligibility from 25 to 21. so if you're making $14,000 or $15,000 a year, and now the earned income tax credit means you can put several thousand
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dollars in your pocket it's an incentive for young people to work and work full time. >> it treats a different group than the increase in minimum wage would treat, although there would be some overlap between the groups and they would qualify for people as low income earners in the united states. but you believe we have to be looking at both of those things at the same typ time. >> part of the reason is i'm trying to be pragmatic on all of this, ali. my goal and that i think th shad by a lot of people is to put money in the hands of people who are doing what we want them to do. they're working. they're fulfilling our social contract, and the other side of that is you should have enough that you can have a place to listen, put food on the table, care for your family. >> for some reason the earned income tax credit is, the expansion of it seems more palatable to conservatives than the increase in the minimum
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wage. they're vehement about not increasing the minimum wage. one of your colleagues said part of the problem with the increase in the minimum wage as some conservatives see it is basically you're saying we would like people to earn more, and we're passing that responsibility on the private business to make them do it. >> there are some people who are hostile to the minimum wage on the whole. another one of my colleagues has suggested combining the two. conservatives are much happier with a subsidy to employers than they are with something that gives money directly to workers. and you know, i think if i'm going to be open-minded about it, i'm perfectly happy to accept some combination of the two, and you can get a broader coalition to build that together. i think the evidence suggests that an increase in the minimum wage does not significantly damper employment, and we're already seeing a number of instances. what we've seen in the past with costco, what we're seeing now
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with the gap is that major employers understand if you want to get workers and keep them, and that means you don't have to pay for new hires. you don't have to go through the whole process not being sure you're going to get decent people, attract and keep good people, an increase in wages is not a bad way to go, and it can be cost effective. >> norm, always a pleasure to talk with you. norm ornstene a res didn't scholar. my final thoughts go out to the federal reserve. it released a page book, this is a probable, but it releases eight beige book as year. you can imagine that the harsh winter weather ha is mentioned heavily in it. in sector after sector, in region after region, it seems that the weather reeked havoc clouding the fed's ability to
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judge the direction of the economy. it may have been raining and snowing in january and february, but now it's pouring for retired fed chief ben bernanke. in one day ben bernanke collected more than his annual salary during his days at the fed. it was his first public debut since leaving the fed, and no doubt there will be more of him to come. that $250,000 fee that he commands is considered among the highest in the public speaking circuit. when it rains, it pierce poors. i'm ali velshi, thanks for joining us.
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>> hi i'm leem lmp and lisa fled you're in the stream. is there a trend towards poverty in the nation's armed forces? >> our digital producer, wajahat ali is here. he's bringing in all your live comments throughout the show. regardless of politics, there

Real Money With Ali Velshi
Al Jazeera America March 5, 2014 7:00pm-7:31pm EST

The impact of jobs, housing, healthcare, education and savings on the economy.

TOPIC FREQUENCY Ukraine 15, United States 7, Us 6, Chavez 6, U.s. 4, Russia 3, Washington 3, Europe 3, Ali 2, NicolÁs Maduro 2, Hugo Chavez 2, Obama 2, Ben Bernanke 2, Ali Velshi 2, Stephen 2, Crimea 2, Kiev 2, America 2, Port City 1, Stephen Schork 1
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on 3/6/2014